ARIN Compensation Program and Practices

Table of Contents

Purpose

To support our stated mission, it is imperative that ARIN be fully staffed with well qualified and motivated employees. Our goal is to attract develop and retain employees of the highest caliber so that ARIN can continue to perform its mission for the Internet community.

Philosophy

ARIN has a documented compensation philosophy and structure that it uses to set salaries. The overall compensation philosophy is to provide our employees pay and benefits that are commensurate with other similar companies in our geographic region. ARIN’s compensation structure also takes into account individual performance, tenure, experience, education, position type and local market conditions. ARIN is located in Northern Virginia along the high tech Route 28 corridor, which is one of the major centers of information technology in the country. In addition, the metro Washington, D.C. area makes the list of the top twenty cities in the nation for the cost of living expenses.

While ARIN is a non‐profit company, it competes directly with for‐profit and technology companies in our pursuit of qualified employees, and must offer competitive salaries and benefits to attract and retain staff. Studies have shown that high turnover in knowledge workers results in a high cost of replacement, so staff stability of successful employees is critical. Maintaining a tenured, highly knowledgeable and experienced workforce allows ARIN to provide our members and the Internet community with the support and services they require.

A complete salary survey (for all positions in ARIN) is completed every two to three years, and most recently in March of 2010 by an outside firm that specializes in such work. In the survey, ARIN salaries and benefits are compared against major salary sources including Mercer, Culpepper, ASAE and HRA. These salary sources are a mix of associations, non‐profits, for‐profits and technology companies. ARIN generally aims to pay salaries in the median range for similarly sized organizations, but in individual cases, we pay above the median in some functional areas so that we can remain competitive in the market in these segments and minimize turnover in our top performing employees.

Evidence of the success of our compensation philosophy is demonstrated by an average tenure of five years, and twenty seven employees who have completed five years of service or more.

Structure

ARIN has a pay grade scale that is adjusted annually to take into account increases in cost of living and inflation. The pay grade scale may also be adjusted based on insight gained from the Market Pricing Salary Survey results.

All full‐time positions at ARIN have a comprehensive job description. These are reviewed annually during the performance reviews at the end of the year. All positions are assigned to a three grade range in the master pay grade scale.

Performance reviews are scheduled bi‐annually. In December of each year, all employees receive a full length performance appraisal that includes both a review by the supervisor and a self‐assessment. Annual objectives for the next year are agreed upon at that point. Halfway through the year, all employees again meet with their supervisors for a performance appraisal, using this time to ensure that their annual objectives and performance are on track. New hires receive a 90‐day review. Performance reviews for the senior executives (President/Chief Executive Officer & Chief Operating Officer) are conducted in conjunction with the ARIN Board Compensation Committee.

Total Compensation Components

Base Salary

Our base salaries aim to match the median salaries in our geographic area, in relation to for‐profit, nonprofit and technology companies. Merit increases are normally given annually, at the first of the year. ARIN expects all employees to continue to grow in skills and capability, and for this reason, most employees will merit an annual increase.

Bonuses

ARIN awards annual bonuses for excellent performance. Excellent performance is determined based on the results of the bi‐annual formal performance reviews. Employees celebrating their 10‐year anniversary with ARIN receive a special one‐time bonus. We plan to add rewards for the 15 and 20 year anniversaries in the future.

Benefits Program

We offer a robust set of benefits to our employees. Our full roster of benefits includes medical, dental and vision insurance; Life, AD&D, Short‐term and Long‐term disability; business travel insurance; training and education opportunities; medical and dependent‐care Flexible Spending accounts; limited fitness facility expense reimbursement; and a computer loan program. The majority of these benefits are fully paid by ARIN. Employees pay a small percentage of the medical benefits.

Time Off

ARIN employees receive 12 paid holidays per year. All permanent, full‐time employees earn between three and five weeks of comprehensive leave per year, depending on tenure with the company.

Retirement Program

All ARIN employees are eligible to join the ARIN 401k plan immediately upon hire. After one year of employment, employees may receive up to a 9% match. The Employee Contributions and the Employer Matches are 100% vested. Our matching schedule is aimed towards rewarding the employees who cannot make a large employee contribution. Employees who contribute between 1‐3% of their salary receive a 200% match of 2‐6%. This encourages all staff to enroll in our retirement program, and in 2010 we have a 98% participation rate in the ARIN 401k Plan.

Severance Plan

After one year of employment, full‐time employees qualify for a severance plan that provides for two weeks of pay in the event of termination (other than for cause.) Senior ARIN personnel may be eligible for a larger severance amount.

Compensation Committee

ARIN’s Compensation Committee, a Board Committee composed of three members, reviews and approves the overall compensation philosophy and direction for ARIN. They also provide direct oversight in setting the compensation of the Senior Executives (President & CEO, and Chief Operating Officer). The Compensation Committee directs the Director of Human Resources and Administration to follow and implement the guidelines of the Compensation Program and Practices as stated above.